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Extended Deadline To Apply For The Paycheck Protection Program Loan

The deadline for small businesses to apply for a Paycheck Protection Program loan has been extended through August 8th. The program has already provided small businesses around the country with over $500B in forgivable loans. The original deadline to apply for a loan was June 30, but as of that date, there were still over $130B left over in available funding for the popular program. On Saturday, July 4th, President Trump signed a bill that would extend the application deadline to August 8th. Any business that meets the qualifications for the program but has not yet applied for a loan now gets a second chance at the popular program. As a reminder, the criteria that need to be met and other key features and provisions of the program are outlined below:

Who is eligible?

  • Any small business concern that meets SBA’s size standards (either the industry based sized standard or the alternative size standard)
  • Sole proprietors, independent contractors, and self-employed persons
  • Any business with a NAICS Code that begins with 72 (Accommodations and Food Services) that has more than one physical location and employs less than 500 per location
  • Any business, 501(c)(3) non-profit organization, 501(c)(19) veterans organization, or Tribal business concern (sec. 31(b)(2)(C) of the Small Business Act) with the greater of:
    • 500 employees, or
    • That meets the SBA industry size standard if more than 500

Loan amount and covered expenses

The maximum amount a company can apply for is equal to 2.5 times their average monthly payroll, and cannot exceed $10M for any single business. The funds from the loan are intended to be used to cover payroll expenses, rent, utilities, and mortgage interest. The loan can be fully forgiven if all of the funds are used on approved expenses, and at least 60% of the forgiven amount must have been used for payroll expenses. Applicants will have 24 weeks to utilize the funds they receive.

Other key features and provisions of the loans

  • PPP loans have an interest rate of 1%. Any amount of the loan that is not forgiven will need to be paid back at this interest rate.
  • Loans issued prior to June 5 have a maturity of 2 years. Loans issued after June 5 have a maturity of 5 years.
  • Loan payments will be deferred for six months.
  • No collateral or personal guarantees required.
  • No loan fees.
  • Applicants can apply for the loan through any lending institution of their choice, as long as the lending institution is approved for participation in this program.

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